May eighteenth, twenty twenty-five (250512-250518)
This weekend is a somewhat ambiguous point in time, and the talks produced no result. However, as we expected, the turning point for tariffs may not be far off. We will explain the specific reasons in the Notes early next week.
1）Bitco positions and gold
After entering with a core position based on cross-asset logic and adding after the uptrend was confirmed, you should have made a very comfortable profit by the time price reached the top of the rectangle.
Chart: Bitco positions
In addition, the market has once again confirmed our view on gold’s top range:
Chart: Rejected again at the expected level; after the pullback, 3300 provided precise support
Chart: New readers, remember to catch up on the previous Notes, from newest to oldest, prioritizing the latest ones
However, Since gold has touched the top of its range once again, under our consistency principle this naturally serves as a risk warning for the Bitco position
Chart: Four rectangles
Simply put: 1) the position reached the top of the range; 2) it also reached a point of strong demand for ATH; 3) add the risk warning from gold; 4) the talks; 5) as we expect, the date of a tariff turning point may not be far off
So we will close out and reduce the position while waiting for ATH confirmation; we will see how things look next week, The only thing we can predict with certainty is that trading volume will increase... As we said before, Bitco, gold, U.S. stocks, and foreign exchange are all ultimately one and the same; the time when volatility in U.S. stocks expands is not far off.
2) Answering how we draw charts
Some people are curious about how we draw charts, so here is a unified answer: we do not use any complicated technical methods, just simple horizontal lines + Volume spike, What works is not complicated. The only powerful price tool is the horizontal line, because that is reality (only the edges reflect the reality of large buying and selling in the market).
3) Keep the updates simple: EURUSD
Chart: Although we have said it so often, the market continues to trade within the projected range
There are some things we no longer dare to post on public platforms. A few days ago, our public account received a batch of comments saying we are even better than Trump at “winning,” and that we have already attracted envious attention, We have never felt “smug” about being right in our views. On the contrary, it is precisely because we know no one can beat the market that Every time, what we feel is really only fear. We are never happy to be right; we are afraid, and at the same time grateful that the few skills we have can keep us alive.
We are very afraid of being right. In the market, no one has a crystal ball, no one can beat the market—we cannot either. We miss things too; we have been very wrong and missed a lot. Strict risk management is what has at least kept us from being wiped out. This is our value system. Whether you agree or not, at least we are making it clear here.
Just carefully trying to earn a living in front of Mr. Market.
4) Keep the updates simple: USDJPY
Chart: Foreign exchange, stocks, and gold are all the same thing
5) Keep the updates simple: S&P
Chart: Downside confirmation failed
The blue line here marks the U.S. Dollar Index (left axis), not SPX, so don't confuse the two. The blue line touched twice but didn't break lower; the downside confirmation failed. That's the logic.
6）Keep the updates simple: oil
Chart: The market knocked us out
The market hit the trailing take-profit level on our oil position and knocked us out.Because the downward revision happened much faster than expected, the holding period for this position became unusually short, though that is normal for oil trading, In this asset, most of the price action tends to be fully priced in over a few key days Overall, our fundamental view is unchanged: we still expect downside and will re-enter at a better price.
7）Keep the updates simple: India
Chart: Take a look alongside this week’s Notes
We specifically discussed India in this week’s Notes, including the issue of trading groups. See Notes250508 The India-Pakistan conflict and the core trading groups in regional geopolitical events; one of the basics of understanding the counterparty (whose money you make)
The titles of the midweek Notes have been getting rather long lately; I owe everyone an apology.
The main reason is that I really couldn’t come up with a title, so I used plain language. At least this makes it easier to remember roughly what the content was about by checking the title when looking back later, Compared with a title, I see its function more as a quick index.
Chart: A shorter time-frame perspective
For event trading or trading the edges of a rectangle, it is interesting to look from a shorter time-frame perspective, and I recommend taking a look when you have time. This is far more useful than reading many technical-analysis books or taking courses.
On the one hand, it is about understanding the power of horizontal lines (a reminder: for us, the only truly real thing is the horizontal line); on the other hand, The market produces hundreds of thousands of candlesticks every day, and 99.999% of them are meaningless. They all follow the random-walk theory of a perfectly efficient market. What you need to practice is finding the key K The ability to do that; most of the time, only those 1-2 candles truly determine the market, are predictable, and have substantive significance.
The weekend is over. I hope everyone who has read this far enjoys life and has a smooth week ahead!
If you made it this far, give us a like so we know!
Note: All content in this article is for reference only, does not constitute investment advice, and does not serve as the basis for any laws, regulations, or regulatory policies. Investors should not use or rely on this information as a basis for decisions.